Discount retailer Dollar Tree (DLTR) reported quarterly results that surpassed analyst expectations for both profit and revenue. The company posted adjusted earnings per share of $1.74, beating the consensus estimate of $1.53, while revenue grew 7.2% to $4.98 billion, also ahead of forecasts. The positive results were attributed to lower freight costs and a 4.5% increase in the average shopper's spending, which offset a 1% decline in store traffic.
In response to the strong performance, Dollar Tree raised its full-year adjusted earnings guidance to a range of $6.70 to $7.10 per share. The upbeat outlook and earnings beat triggered a significant market reaction, with Dollar Tree's stock soaring 16.9% in morning trading, putting it on pace for its best single-day gain in years. The positive sentiment also lifted shares of its rival, Dollar General.